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The Coverage You Can Expect From a Small Business Insurance Policy

May 16, 2012

Commercial InsuranceSmall businesses may not have many employees or large offices, but they still require the right insurance coverage to protect all of their assets.  Especially when you are starting up a small business, you can’t afford to be without a good and comprehensive commercial insurance policy.  What that entails is a package that includes the basics of commercial insurance: liability and business property, and, depending on your line of work, any other requisites to properly cover your company.


The Basics of Small Business Insurance

Although it is small, your business still needs the same basic coverage options as a large company.  This means you need to have liability coverage to protect you from potential lawsuits, property insurance to cover all of the contents of your office, warehouse, or any other company space..

These  form the basis of any small business insurance policy, but they are not the total picture.  There are other coverage options you will need to select based on the type of business you run and your particular risk factors.

Liability insurance is often sold together with property insurance as a very basic commercial insurance package.  Every small business needs these two coverages.  Liability protects you from a wide variety of situations in which the company, you as the business owner, or employees of the company could be found to be negligent and face legal action.  General liability encompasses a number of possibilities and is the foundation of your insurance in this area.

Property coverage is included in a small business insurance package policy to cover the contents of your office or other business space as well as any equipment belonging to the company from theft, fire, or other damages.


Adding To Your Small Business Package

In addition to the basics, there are other forms of coverage your small business might need depending on the type of company you are running.  Adding these to the basics of small business coverage can complete the picture and make sure you have all the protection you need.

If you are running a professional office, you may require professional liability.  This is a coverage that protects you from lawsuits based on your performance as a professional.  The most commonly know form of this coverage is malpractice; although it’s usually mentioned in relation to medical professionals, malpractice insurance actually covers many other professionals as well.  Another area of this type of coverage is errors & omissions insurance.  This protects your company from liability resulting from inadvertent mistakes that wind up doing damage to a client.  Attorneys, accountants, tax professionals and similar professionals require this type of coverage, since simple mistakes on their part can have far-reaching consequences.

If your company produces a product, you should consider product liability insurance.  This protects you from any claims regarding the product itself, such as in the case of a manufacturing defect that causes injuries.  As you grow, you may also consider need employment practices liability insurance and employee dishonesty coverage.

A company that uses vehicles as part of its daily business will require a commercial auto policy, which protects the company from the impact of an accident involving the business owner or any employees behind the wheel of a company car or while on company business.


The Right Small Business Coverage

Putting together a small business policy is complex, and many factors depend on the type of business you are involved in.  An insurance professional can take the time to ask all the pertinent questions about your business, and is trained to recognize the particular risks of your industry.

Every small business needs a comprehensive policy that brings together the basics with any additional or optional coverage you might want to need to add.  Some policies are packaged together with several of the most common options included to make it simpler for you to choose your coverage.

When it comes to protecting your business, it is always better to have more coverage than you think you need.  Consider topping off your package with an umbrella policy that will extend your liability protection beyond the limits of each individual coverage and ensure you can stay in business even if something goes wrong.

  • Jane

    I drive a small dump truck ,month ago guy hit my truck,no tickets were given but yesterday a suit has been filed against the company and my boss says if he looses to this guy I can also be personally sued and I will get points on my license,is this true.